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AIFMD patchwork 'will deter' non-EU firms
10 December 2013
Sturgeon Ventures creates service to help AIFs cope with varying rules across the EU markets
Sturgeon Ventures has launched a new service to help
alternative investment funds (AIFs) cope with the "patchwork
quilt" of rules emerging under the EU Alternative Investment
Fund Managers (AIFM) directive.
The firm believes that non-European funds are likely to be
deterred from trying to operate in the EU due to the variance
in how member states treat the inward marketing of AIFs.
The National Private Placement Regime enables fund managers to
market hedge funds in the EU that are ineligible for
passporting under the AIFM directive, either because they
originate outside the European Economic Area or they are
managed by non-EEA managers.
Figures from E&Y show that around 17 of the EU member
states intend to allow some form of private placement, while
others have even yet to announce their intentions.
Sturgeon predicts that in particular US hedge funds domiciled
in the Cayman Islands will give up trying to run in the EU as a
result of these difficulties.
"The market is frustrated with the current uncertainty in the
EU and regards the AIFMD as having created some increased
operational headaches in getting funds into the EU. These
issues cannot be ignored but at the same time they are not
insurmountable and Sturgeon's new service does offer a
solution," said Jake Green, senior associate at Ashurst, the
regulatory legal firm.
Sturgeon's new service enables AIFs to produce bespoke
submissions that meet each country's regulatory
Seonaid Mackenzie, managing partner at Sturgeon, said: "We
believe we are the first regulatory incubator or 'umbrella' to
provide this service. We are working with a number of law firms
that that can draft the relevant appendices to current offering
memorandums in line with the different jurisdictions. We can
update our service almost as fast as countries can announce
their new regimes."